Lakkotrypis confirms Shell’s interest to buy Cypriot gas

Energy Minister Yiorgos Lakkotrypis said Royal Dutch Shell has showed interest in buying Cypriot and Israeli gas over the next 10 years.

Lakkotrypis, who was speaking on state radio CyBC, confirmed a Bloomberg report saying Shell was interested in buying 10bn cubic metres of Cypriot and Israeli natural gas over the next 10 years for $25bn (€20.3bn).

The minister said Cyprus was “close to a deal,” relating to talks to sell gas to one of the two liquefaction plants on Egypt’s Mediterranean coast via pipeline, without revealing additional details.

“I don’t want to specify if it is the terminal in Idku managed by Shell to which the Bloomberg report was referring to.”

“The talks involve both terminals and are at a quite advanced stage,” he said.

Lakkotrypis declined to say whether Noble Energy, the Houston-based gas company which together with Shell and Israel’s Delek Drilling, has the licence to develop the 4.5 trillion cubic feet (tcf) Aphrodite field in block 12 of Cyprus’s exclusive economic zone (EEZ), insisted on reducing the government’s share in the revenue from the project before going ahead.

“The only thing I can say is that we have difficulties with the prices,” he said in reference to the drop of the oil prices in 2014, which led to a reduction in the development of hydrocarbons worldwide.

Lakkotrypis added that Eni’s failed attempt to drill at Cuttlefish last month, as the target in block 3 is dubbed, after Turkey sent warships to the area to prevent the company from doing so, while it “was a bad development,” it was only a postponement.

Talks with Eni about its future exploratory programme are ongoing, Lakkotrypis said.

Eni has the hydrocarbon exploration and exploitation licence for several blocks in Cyprus’s EEZ, either on its own, as it is the case with block 8, or together with France’s Total (blocks 6 and 11) and South Korea’s KoGas (blocks 2, 3 and 13).

His comments were made as a vessel is about to begin surveys in block 10 owned by the consortium of ExxonMobil and Qatar Petroleum, ahead of an exploratory drilling in the second half of the year, likely in October, he said.

The Ocean Investigator, is scheduled to carry out an environmental survey, a precondition ahead of the submission of an environmental impact study ahead of the drilling.

A second vessel will carry out an archaeological survey to determine whether antiquities are located in the area.

Lakkotrypis said that while the two vessels will carry out operations which other companies did repeatedly in the past without attracting media attention, in their case, things are different after Turkey’s latest military action.

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